Assume you make the following investments: A $10,000 investment in a 10-year Treasury bond that...
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Assume you make the following investments: • A $10,000 investment in a 10-year Treasury bond that yields 11.5%, and • A $20,000 investment in a 10-year corporate bond with an AA rating and a yield of 15.0% Based on this information, what is your estimate of the corporate bond's default risk premium? Assume you make the following investments: • A $10,000 investment in a 10-year Treasury bond that yields 11.5%, and • A $20,000 investment in a 10-year corporate bond with an AA rating and a yield of 15.0% Based on this information, what is your estimate of the corporate bond's default risk premium?
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